N.Y.C. Housing Isn’t Being Built Fast Enough, Report Says

Housing experts and politicians agree that New York City needs to add hundreds of thousands of new homes. The Real Estate Board of New York is keeping tally.

In 2022, Mayor Eric Adams set a “moonshot” goal of building 500,000 homes over the next decade. With people pouring into New York City from around the world and many locals tired of living in overcrowded apartments, housing experts and other politicians agreed that the need for more housing was urgent.

But it is taking on average more than three years to build a single apartment building and the city is not on track to meet that goal, according to a new report released on Tuesday by the Real Estate Board of New York, the industry’s influential lobbying and advocacy group.

The report, which is intended to be the first in a series of checkups on the progress toward 500,000 new homes, found that the sluggish pace of construction is holding the city back. It estimated that it takes on average 3.4 years to build a new apartment building; in Manhattan, it takes more than four years, the report said.

Since the beginning of 2024, the city has already added some 66,000 units, according to the report, and is adding about 9,450 units per quarter. But it needs to be adding more than 13,100 each quarter to meet the 500,000 unit goal.

The slow going is the result of many factors, including regulations and red tape; zoning restrictions; high interest rates; and the economic fallout from the coronavirus pandemic, when construction ground to a halt, said Basha Gerhards, the board’s executive vice president of public policy.

The report is the latest to underscore the challenges facing New York City, which has an apartment vacancy rate of just 1.4, the lowest in more than 50 years, as rents continue to rise.

Mr. Adams, Gov. Kathy Hochul and a growing number of politicians agree that hundreds of thousands more homes need to be built. Even the progressive left, which had traditionally fought the real estate industry over development, has made growth a key focus.

On Friday, Zohran Mamdani, the mayor-elect, said at a news conference that he might disagree with the real estate industry on some issues, like the role of labor. But “one place of immense agreement is we have to eliminate the cost of waiting,” he said.

There are many competing estimates of how much more housing is needed based on population and job trends, birth and death rates, immigration and more.

One analysis from 2024 by the Regional Plan Association, a nonprofit planning group, pegged the housing shortage at 540,000 units across the New York City metropolitan region. Another analysis done this year by Up For Growth, a Washington-based think tank, estimated a shortage of around 355,000.

There is also disagreement over how to close the gap.

Mr. Mamdani has pledged to build 200,000 homes over the next 10 years — all of them subsidized. Growth advocates want to remove zoning limits. Some on the political right have called for more senior housing and deregulation to incentivize construction. There’s also debate around the trade-off between building studios versus two-bedroom apartments, which are more expensive.

REBNY’s report, which the organization plans to update twice a year, does not offer a way to reach the goal. Instead, it seeks to capture recent trends so the city can better measure its progress going forward, Ms. Gerhards said.

One choke point in the process is a period known as predevelopment: After developers have finalized plans but before they can start construction, they have to get the proper permits.

The report found that as of October, there were more than 47,100 units in this category. More than 30 percent had been there for more than five years, indicating “they are likely stalled or may never begin construction at all.”

The slow pace is sometimes the result of laws and regulations designed to protect the public.

They can involve detailed, complicated requirements for electrical systems, mechanical systems and plumbing, which Ms. Gerhards said could take up to three years to meet — a time period during which the rules can and often do change, altering construction plans.

But she also said there were reasons to believe development might speed up in the coming years.

City leaders passed the “City of Yes” last year, a package of zoning changes intended to bolster development across the city and make it easier to convert older office buildings to homes.

Voters this November passed several ballot measures also designed to speed up development. The state has passed a new tax incentive program to encourage the construction of apartment buildings.

All of those changes are still new, and Ms. Gerhards said REBNY’s findings could help assess whether they were working as intended.

“We need to establish the base line,” she said.

Related Content